Legislative Update

Monday, June 27, 2016
June 27, 2016 Legislative Update

General Assembly Wraps Up Short Session, Budget Negotiations Final?

As the end of the short session swiftly approaches, last week at the General Assembly was characterized by the telltale signs of adjournment: budget negotiations, an influx of proposed committee substitutes, and long days of legislative activity. The Senate held a full day of meetings last Friday, an irregular event for a Friday, in an attempt to complete committee work expeditiously. The House and Senate remains committed to enjoying Independence Day fireworks from their home counties.

The budget conference process, which began two weeks ago, has apparently wrapped up. Over the weekend, sources have claimed that final budget negotiations were completed on Saturday. It is expected that the final budget document will be made public and posted sometime this evening.

I-77 Bill, Not Moving in the Senate
A bill that sought to terminate the contract between the state and Cintra in building a toll lane on I-77 outside of Charlotte has died for the year. HB 954: Terminate Agreement for Tolling of I-77, sponsored by Reps. Charles Jeter (R-Mecklenburg), Mike Hager (R-Rutherford) and John Bradford (R-Mecklenburg), passed the House earlier this month by an 81-27 vote, but will not be moving in the Senate this year after the Senate Republican Caucus announced that they voted to not move the bill forward this year. It is still possible that similar legislation could surface in next year’s long session.

Several Regulatory Reform Measures Move Forward

Regulatory Reform Act of 2016

The Senate failed to concur on the changes made by the House on SB 303: Regulatory Reform Act of 2016 on Tuesday. The legislation was introduced as a proposed committee substitute in April. A conference committee may still be appointed to work through the differences between the two chambers’ version of the bill.

Occupational Licensing Boards

On Wednesday, the Senate Committee on Finance discussed a proposed committee substitute to HB 1007: Amend Occupation Licensing Board Statutes, which is sponsored by Reps. Jonathan Jordan (R-Watuga), Sarah Stevens (R-Surry) and Rob Bryan (R-Mecklenburg). The PCS includes the original provisions of Rep. Steven’s bill, which responds to the decision of North Carolina State Board of Dental Examiners v. Federal Trade Commission and clarifies the educational requirements for barber registration, and additional provisions. Additionally, the proposed committee substitute:

  • Clarifies the requirements for licensure as a professional engineer.
  • Amends certain laws related to the North Carolina Medical Board.
  • Increases the time for certification of chiropractic clinical assistants.
  • Increases the fee for real estate broker license applications.
  • Amends current law regarding dispensing optician examination qualifications.

2016 Farm Act

SB 770: NC Farm Act of 2016, sponsored by Sens. Brent Jackson (R-Sampson), Andrew Brock (R-Davie) and Bill Cook (R-Currituck), passed through the Senate on Monday, and was reviewed by the House Committee on Agriculture yesterday. The bill includes the following provisions:

  • Excludes minor repairs from building permit requirements.
  • Provides enforcement authority for the Department of Agriculture and Consumer Services (DACS) for the program governing improperly sanitized, made or tagged bedding.
  • Enacts an Agricultural Emergency Response Act and authorizes DACS to deploy response teams in emergencies.
  • Directs DACS to inspect the building, grounds and equipment of animal product rendering plants.
  • Allows local school boards to develop and implement policies to purchase locally grown food for cafeteria programs.

The bill will be voted on by the House Committee on Agriculture on Tuesday.

Environmental Law Amendments

Last week, the Senate passed a bill that includes numerous amendments to current environmental and non-environmental law. HB 593: Amend Environmental & Other Laws, sponsored by Rep. Pat McElraft (R-Carteret), has been sent back to the House for concurrence to the changes made by the Senate. While in the Senate, the previous contents of the bill were replaced. The Senate committee substitute includes the following changes:

  • Makes changes to the franchise agreements between local governments and the construction and operation of a sanitary landfill.
  • Deletes a proposed revision to current law concerning agriculture employment status and union or nonunion status.
  • Deletes a proposed revision which delayed the insurance requirement for moped owners.

Senate Passes UNC & Capital Improvement Projects

Last week, the Senate voted 43-1 on SB 872: UNC Self-Liquidating Projects, a bill sponsored by Sen. Tom Apodaca (R-Henderson). SB 872 authorizes five UNC institutions to finance a total of ten capital improvement projects on their campuses without an appropriation from the General Fund.

The projects include building and renovating housing, student and wellness centers, academic and administrative buildings, and other capital improvements at Appalachian State University, North Carolina Central University, North Carolina State University, University of North Carolina at Charlotte and UNC Hospitals at Chapel Hill. The bill has been sent to the House for consideration.

House Passes Body Camera Regulations

A bill that would create the state’s first regulations of body-worn cameras, HB 972: Law Enforcement Recordings/ No Public Record, passed the House last week by a 87-19 vote. The bill, which is sponsored by Reps. John Faircloth (R-Guilford), Allen McNeill (R-Randolph), Jamie  Boles (R-Moore) and Pat Hurley (R-Randolph), provides that recordings made by law enforcement agencies are not public record, and establishes the process in which records can be requested and obtained.

Several changes have been made to the legislation during its consideration in the House. The changes primarily clarify how an individual can request a recording, and the process to appeal a rejected request. The bill will receive its final approval from the House on Monday night.

Several Omnibus Local Government Proposals Considered

Numerous bills affecting local governments were considered last week, including:

HB 100: Local Government Immigration Compliance, which was introduced in the Senate by Sen. Norman Sanderson (R-Pamlico), creates a process for the attorney general to investigate allegations of a local government not complying with state immigration laws. Under the legislation, local governments found to be out-of-compliance could lose state funding for schools and roads.

HB 483: Land-Use Regulatory Changes, a bill which was considered last year during the long session, resurfaced this week in the Senate. The bill, which is sponsored by Rep. Jonathan Jordan (R-Ashe), makes numerous changes to land-use laws. The bill passed Senate Commerce last week and has a serial referral to Senate Rules.

HB 407: Housing Authority Transfers, was introduced in the Senate Committee on State and Local Government last week, and it will allow municipalities to transfer a housing authority to a regional council of government.

HB 1035: LGC/ Training for Local Government Finance Officers, sponsored by Reps. Allen McNeill (R-Randolph), Linda Johnson (R-Cabarrus) and Frank Iler (R-Brunswick), would require basic financial training for finance officers of local governments and public authorities. 

SB 803:  Revenue Law Technical, Clarifying & Administrative Changes, which passed the Senate last week, makes numerous changes to the state’s revenue laws, including a section which allows the city and the county it is in to exchange tax information with one another to administer taxes. The bill has been referred to the House Committee on Finance.


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Monday, June 20, 2016
June 20, 2016 Legislative Update

House and Senate leaders continue to pass legislation regarding regulatory reform, tax and economic development, healthcare, and education. Budget negotiations between the two legislative bodies continue as well, and many expect an adjournment resolution within the next two weeks.

Senate & House Negotiate Tax Reform Provisions

Tax Cap

Senate finance leaders are proposing a bill that could constitutionally limit future income tax increases. Sens. Bill Rabon (R-Brunswick), Jerry Tillman (R-Randolph) and Bob Rucho (R-Mecklenburg) are the sponsors of SB 817: Constitutional Amendment-Max Income Tax Rate of 5.5%. If the bill is signed into law, voters will have the opportunity to vote on the constitutional amendment to limit the state income tax to 5.5%. Currently, the state constitution does not permit an income tax rate higher than 10%.  The bill is on the Senate calendar for June 25 for an unusual Saturday session, another indication that the session is coming to a close.

Proposed Tax Changes

On Thursday, the House Finance Committee discussed a bill draft that would make several changes:

  1. Clarifies the application of the sales and use tax on repair, maintenance, and installation (RMI) services.
  2. Enacts the NC New Markets Jobs Act, which provides a state-level tax credit for equity and debt investments in Tier 1 or Tier 2 counties that qualify for the federal New Markets Tax Credit.
  3. Allows local governments to exchange tax information for purposes of administering taxes.
  4. Exempts from sales and use tax materials that are used in an accepted wastewater dispersal system.

The bill, which will be titled HB 994: Sales Tax of RMI Clarified/Other Tax Changes, will be negotiated as the House and Senate finalize the final budget.


The Senate Finance Committee reviewed SB 481:Fund Small Businesses/Publish DOR Rulings on Wednesday. The bill would allow small businesses to raise funds through crowdfunding (raising funds from multiple people such as friends or family) which has been made very popular through the internet. The second half of the bill will require public disclosure of all written determinations made by the NC Department of Revenue. The bill is sponsored by Sens. Tamara Barringer (R-Wake), Ralph Hise (R-Mitchell), and Rick Gunn (R-Alamance).

Several Regulatory Reform Packages Advance

Environmental Amendments

Last week the Senate introduced a new version of HB 593: Amend Environmental & Other Laws. Among its 23 sections, HB 593 would prohibit cities from charging fees for utilities’ use of right-of-way, require the Division of Coastal Management to study the current long-term erosion rates adjacent to terminal groins, and make changes to storm water regulation. The bill passed the Senate Agriculture/Environment/Natural Resources Committee on Thursday and will now be heard in Senate Finance.

Farm Act

On Monday, the Senate will be debating SB 770: NC Farm Act of 2016 on the floor. Among other provisions, SB 770 would establish the "Agricultural Emergency Response Act," exempt certain minor repairs from building permit requirements, and would also create a voluntary assessment on deer feed.

Flight Paths/Military

Sen. Harry Brown (R-Onslow) introduced legislation on Wednesday that would increase regulations on the wind energy industry. The bill would limit how close a wind farm can be to a military base or installation. The legislation, HB 763: Military Operations and Protection Act of 2016, would require permits for wind farms to be approved by the NC Department of Military & Veterans Affairs and the NC Department of Health & Human Services. Supporters of the legislation say that the bill is necessary to protect the state’s many military installations from another round of base realignment. Proponents also state that the wind energy towers would provide significant safety hazards for pilots training in the airspace near many of NC’s military installations. However, those in the wind energy industry vehemently oppose the bill, which they say will kill two potential projects in the state in Tyrell and Perquimans Counties. The bill passed its second reading on the Senate floor Thursday.

Online Legal Documents

The House and Senate passed legislation this week that would clarify the definition of the practice of law. The legislation, HB 436: Unauthorized Practice of Law Changes, is the result of a court case settled between the State Bar and Legal Zoom last year. The bill will allow online websites to provide legal documents, pending the review of an attorney that is licensed in North Carolina. The bill, sponsored by Reps. Leo Daughtry (R-Johnston), Rob Bryan (R-Mecklenburg), and Ted Davis (R-New Hanover), will be sent to the Governor for his approval.

Omnibus Regulatory Reform Legislation

The House and Senate are both working on legislation to reduce restrictions and regulations on businesses. On Tuesday, the Senate approved HB 169: Regulatory Reduction Act of 2016. Yesterday, the House passed a competing measure, SB 303: Regulatory Reform Act of 2016, out of their chamber. Since both bills received major modifications in the opposite chambers, it is likely that these bills will both go to conference committee, where one compromise measure will likely be the result.

Department of Transportation, Policy Changes & I-77

Cancelling I-77 Toll Could Cost NC

Nick Tennyson, Secretary the NC Department of Transportation, sent a letter to the Senate Transportation Committee, indicating that the passage of HB 954: Terminate Agreement for Tolling of I-77, which would cancel the proposed toll on I-77, could cost $800 million. If the bill passes, the state would be forced to cancel the contract with Cintra, a Spanish infrastructure and development company, and would have to reconstruct parts of the road. The bill would also cancel a number of other projects in North Mecklenburg. The bill is now in the Senate Transportation Committee.

DOT Proposed Legislative Changes

After passing the House in early June, the Senate followed suit this week and approved HB 959: DOT Proposed Legislative Changes. Provisions within the bill include changes to bicycle safety laws and a requirement for DOT to study fees for broadband and fiber optic in DOT right-of-way. Since the Senate made changes to the House’s version, it will go back to the House for concurrence.

Senate Introduces Certificate of Need Law Changes

On Tuesday, Sen. Ralph Hise (R-Mitchell), introduced a bill in the Senate Health Care Committee that would entirely repeal the state's certificate of need (CON) law. Proponents of the repeal have stated that the law, which requires health care providers to apply to the state to open a new facility or buy a large piece of equipment, such as a MRI machine, drives up health care costs. Opponents of the repeal, however, believe that the CON law keeps the market stable and allows for small and rural hospitals to be able to function as full-time health providers. The bill, which currently reads as HB 161: Adopt State Cat, was not voted on by the committee. Committee leaders said they will take the measure back to the Senate Republican Caucus to further discuss.



Posted by: Kerri A. Burke, McGuireWoods Consulting LLC @ 12:00:00 am  Comments (0)
Tuesday, June 14, 2016
June 13, 2016 Legislative Update

June 13, 2016

North Carolina General Assembly

House & Senate Continue Budget Negotiations

Last week, the House voted unanimously to not concur with the Senate’s budget proposal. Speaker Moore and President-Pro Tem Berger appointed their budget conferees on Thursday. Rep. Nelson Dollar (R-Wake) and Sen. Harry Brown (R-Onslow) were appointed chairmen of the House and Senate conference committee. Review the full list of budget conferees.


House & Senate Introduce Competing Regulatory Reform Proposals

The House and Senate have proposed two different pieces of legislation that would reduce regulations on businesses, local government, and on the environment.

Last week the House introduced SB 303: Regulatory Reform Act of 2016. SB 303 covers the following provisions, which are not included in the Senate’s proposed regulatory reform bill:  

  • Clarifies that a franchisor is not the employer of the franchisee or the employees of a franchisee for employment law claims under state law.
  • Requires the Building Code Council to examine the NC Building Codes in order to develop a more streamlined code and to assure that code provisions are only in one code volume.
  • Provides that a public agency that makes its public records and computer databases available online, in a downloadable format, and not required to provide copies through any other method.
  • Requires the Program Evaluation Oversight Committee to amend the Program Evaluation Division's work plan to study the State law and internal agency policies and procedures for the delivery of public services through State grants and contracts to nonprofits.
  • Clarifies that the Department of Transportation stormwater requirements are applicable to state road construction undertaken by private parties.

The Senate’s version, HB 169: Regulatory Reduction Act of 2016, will be heard on the Senate floor on Monday, June 13. Provisions within HB 169 include:

  • Authorizes the Department of Military and Veterans Affairs to review and comment on military-related permit criteria of wind energy facilities, buildings, and other structures.
  • Prohibits state agencies from adopting policies that would increase costs to a business of over $100 million for a five year term.
  • Removes a ban on computers, televisions, and other electronics from landfills, and a requirement for local governments to report the disposal of electronic devices in landfills.
  • Eliminates the following counties from required yearly emissions inspections: Burke, Cleveland, Robeson, Rutherford, Stanly,  Stokes, Surry, and Wilkes
  • Removes the Commission of Public Health’s ban on the sale of turtles for non-scientific, educational and culinary reasons.

Additionally, during the debate, language was removed from HB 169 that would have expanded on site liquor sales at distilleries. The language would have allowed visitors to purchase one bottle of each code item following a tour of the distillery once a year. The language was met with strong opposition by those saying that it increase access to liquor outside of state controlled ABC Stores, which have limited liquor consumption across the state.


Senate Debates Charter School Changes & Common Core

  • Charter School Funding

A bill that would increase funding for charter schools, which passed through the Senate last year along party lines, has come back to the House for concurrence after substantial changes were made. Though the bill was originally filed to make school playgrounds accessible to the public, it was rewritten in the Senate as HB 539: Charter School Funding. The bill would require local education authorities to send more funds to charter schools in their district. The state currently has 158 charter schools, which do not fall under the governance of local boards of education. In contrast with traditional public schools, many charter schools do not offer programs such as Junior Reserve Officer Training Corps, school transportation, and athletics. Opponents of the bill say that giving charter schools access to federal grants will decrease funding from traditional public schools, while others say it balances the inequalities between the charter and public schools in terms of funding. Currently, the state and local school boards provide funding on a per pupil basis for the charter schools.

  • Various Charter School Changes

H242: Various Charter School Law Changes, was introduced in the Senate Committee on Higher Education on Wednesday. The bill would change the grading scale for charter school performance. The State Board of Education would identify a “low performing school” as a school that has received a grade of D or F in two of the last three years. The bill would also prevent the State Board of Education from rescinding the school’s charter based on the school’s performance record, if the school is meeting growth expectations. The bill is scheduled to be considered on the Senate floor Monday evening.

  • Math Curriculum/ Common Core Changes

Senate education leaders are proposing legislation that would change North Carolina’s high school math curriculum through HB 657: Math Standard Course of Study Revisions. The bill would expand the high school curriculum to allow the traditional math track, Algebra I, Geometry and Algebra II, as well as the Common Core math curriculum, Math I, Math II and Math III. The Common Core Math Curriculum, known as Integrated Math, was substituted for the traditional math curriculum in recent years. Sen. Barefoot and Sen. Tillman, chairmen of the Senate Education and Higher Education Committee, say that providing both curriculums in high schools will allow students to choose which curriculum works best for them. The committee heard public comments from parents, teachers, and members of the education community on Wednesday. The bill is scheduled to be heard on the Senate floor on Monday evening.


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Monday, June 6, 2016
June 6, 2016 Legislative Update

Senate Passes Budget Proposal, Onto Conference Committee Negotiations

Last week, the Senate unveiled their version of tweaks to the state’s two-year budget, totaling $22.225 billion, a 2.3% increase from last fiscal year. Shortly after midnight Friday, the full Senate passed the budget after passing six amendments with a 26-16 vote that split across party lines. It is expected that when the House receives the Senate’s version of the budget Monday, that they will reject the changes and a conference committee will be appointed to work out the differences.

Read the full Senate Budget.

Senate vs. House, Key Budget Differences

Tax Reform: 

Several tax reform bills, which were originally vetted as separate bills in the Senate, have been included as special provisions in the Senate’s version of the budget.

  • SB 870: Refine Sales & Use Tax, provides a grace period for the under collection of sales and use tax on repair, maintenance, and installation services and refines the application of those taxes. This is not included in the House budget.
  • SB 869: Market-Based Sourcing, establishes that market-based sourcing will be used for multistate income tax apportionment. This is not included in the House budget.
  • SB 818: Increase the Zero Tax Bracket, increases the standard deduction for personal income taxes to $17,500 immediately. The House version included a similar increase in the standard deduction; however, they proposed a gradual increase in the standard deduction reaching $17,500 by 2020.

Education K-12:

  • Teacher Pay Raises: Both the Senate and House versions include increasing teacher pay. The Senate version includes annual, incremental raises for the first 15 years of teacher service and every 5 years thereafter. The House version included pay raises every five years and a lower average salary. The Senate version would raise average teacher pay to $55,000, while the House proposed a raise to $50,000 in average teacher pay.
  • Opportunity Scholarships: The Senate has proposed to serve an additional 2,000 students per year with opportunity scholarships, at a cost of an additional $10 million per year. The House version of the budget included some clarifying changes to the opportunity scholarship program, but lacked this “forward funding” provision.
  • Third-Grade Reading: The Senate version includes a pilot program that would award bonuses to third-grade reading teachers based on performance. This provision is not included in the House budget.

Higher Education:
Two provisions in the Senate budget, which are not in the House budget, make several changes to college tuition laws including.

  • Creation of the Cheatham-White Scholarship, a merit-based, full-ride scholarship program for students at North Carolina Agricultural and Technical State University and North Carolina Central University.
  • Implementation of the NC Promise Tuition Plan, which reduces tuition at Western Carolina University and UNC Pembroke to $500 per semester for in-state students. Originally, the budget included three historically Black colleges and universities, Winston-Salem State, Fayetteville State and Elizabeth City State Universities, but after much pushback they were removed by a floor amendment.

State Employee Pay & Cost-of-Living Adjustments:

The Senate version allocated funds for merit raises averaging 1% and performance-based bonuses averaging an additional 1%. Following the governor’s proposals, the House version of the budget included 2% across-the-board pay raises for all state employees.

The House and Senate versions also disagree on state retiree cost-of-living increases, which are absent in the Senate’s version. The House version includes a 1.6% increase.

Rainy Day Reserves: 

The Senate version of the budget appropriates more to the Rainy Day Reserves than the House version, appropriating $583 million to the fund, compared to the House’s $300 million.


House Votes to Terminate I-77 Agreement

Last week, the House put forth a proposal to cancel the state contract to build toll lanes on Interstate 77. HB 954: Terminate I-77 Agreement, passed the House by a bipartisan 81-27 vote. The bill is sponsored by Mecklenburg Republicans Reps. Charles Jeter and John Bradford, and Mike Hager (R-Rutherford). If passed, the legislation would direct NCDOT to terminate the contract and suspend the eight projects associated with it.

Secretary of the NC Department of Transportation Nick Tennyson has warned lawmakers of the risks involved with cancelling the contract, including the possible $250 million cost of doing so and possible effect on future highway contracts.

The Charlotte Chamber will continue to be engaged in conversations with the General Assembly as the proposal moves to the Senate. We would like to thank those Mecklenburg area legislators who voted NO on the measure: Dean Arp (R-Union), Bill Brawley (R-Mecklenburg), Dana Bumgardner (R-Gaston), Becky Carney (D-Mecklenburg(, John Fraley (R-Iredell), Craig Horn (R-Union), Rodney Moore (D-Mecklenburg), Jason Saine (R-Lincoln), John Torbett (R-Gaston) and Speaker Tim Moore (R-Cleveland).


House Passes Comprehensive DOT Changes 

Last week, the House voted on HB 959: DOT Proposed Legislative Changes, which is sponsored by Reps. Frank Iler (R-Brunswick) and John Torbett (R-Gaston), passing it by a 104-4 vote. In addition to the initial provisions in the bill, which were made at the request of the Department of Transportation, three amendments were made on the floor. The amendments make the following changes to the bill:

  • Adds new language providing that no agreement for use of a DOT right-of-way retracts the DOT ownership and control of the right-of-way and puts in place that the costs of placement of non-utility owned communications or data cable are the responsibility of the users of the right of way and not the DOT. 
  • Adds a new section, DOT Surveying Changes, which gives the DOT additional power to provide NC grid coordinates for each parcel acquired by the DOT after January 2017.
  • Permits the NC Turnpike Authority to send bills electronically and requires them to report to the Joint Legislative Transportation Oversight Committee concerning the number of one-time toll facility users who are charged more than $50 in processing fees and civil penalties.


House Passes New Measure for Low-Performing Schools

After several hours of debate, HB 1080: Achievement School Districts passed through the House by a 60-49 bipartisan vote. The bill, which is sponsored by a bipartisan group of Reps. Rob Bryan (R-Mecklenburg), Cecil Brockman (D-Guilford) and John Bradford (R-Mecklenburg), would allow private charter school companies to take over some of the state’s lowest performing public schools.


Governor McCrory Issues Response on Coal Ash Commission

Last week, Governor Pat McCrory released a response to SB 71: Comm’n Appointment Modifications, the legislation which would reinstate the Coal Ash Management Commission. The governor has said that, “this legislative vote is not good for our environment or for the rule of law in North Carolina,” and has indicated that he will veto the bill. 

The primary purpose of the legislation is to reinstate three environmental commissions: the Coal Ash Management Commission, Mining Commission, and Oil and Gas Commission. The bill also requires that a permanent water supply is provided to households that have a drinking water supply well located within a one-half mile radius from a coal ash pond. 

The bill was presented to the governor on June 2 and he will likely veto it this week; he has ten days to do so.


Posted by: Kerri A. Burke, McGuireWoods Consulting LLC @ 12:00:00 am  Comments (3)
Tuesday, May 31, 2016
May 31, 2016 Legislative Update

General Assembly Keeps Fast Pace, Senate to Unveil Budget Recommendations

Last week, House and Senate leaders introduced many bills that are of significant priority for the short session. Tax reform, regulatory reform, and tuition reduction at certain public universities were highlights last week’s activity at the General Assembly. The Senate continues to review the House’s budget proposal, and it is expected that they will release their proposal early this week.

Economic Development, Finance and Tax

Personal Income & Standard Deductions
The Senate passed unanimously SB 818: Middle Class Tax Relief Act, which reduces the standard deduction for tax filers. The proposal is estimated to save tax payers $145 million in 2016-17 and $205.4 million in 2017-18.  For married taxpayers filing jointly the measure will increase the deduction by $1,000 for the next two years, bringing it to $17,500. For single taxpayers, the proposal would increase the deduction by $1,000 over the next two years and for heads of households by $1,600. Within the House budget proposal passed last week, the same tax deductions were included but were spread out over four years, vs. the two years within this proposal.

IRC Update

The House and Senate officially approved SB 726: IRC Update last week, which includes technical updates to the Internal Revenue Code. Aside from conforming the state’s tax code to the federal code, the legislation also provides a tax deduction for teachers for up to $250 for classroom supplies. Before the final vote, the Senate removed one House provision of contention that would have given debt forgiveness to property owners selling properties contaminated from leaking underground storage tanks or pollutants from adjacent properties. The bill now goes to the Governor for his consideration.

Special Property Tax Districts
The Senate gave final approval to HB 1023: Municipal Service Districts/Statutory Changes on Wednesday, which is a compromised version of changes to special property tax districts. The measure provides for a process where property owners can petition for a new municipal service district and/or exempt property from a service district tax if it is proven that the services are not needed. The bill sets transparency requirements allowing the public to access information about contractors hired by municipalities from the special tax. The bill now goes to the Governor’s desk.

Seasonal Attraction Employees & Minimum Wage
The House introduced a new proposal last week, SB 363: Wage & Hour/Local Govt/Assessments/Parks, permitting “seasonal attractions” employers to pay employees less than minimum wage. The bill adds the new category of employees to the state exemption from minimum wage, overtime and record-keeping requirements of the federal Fair Labor Standards Act. In addition, the measure allows local governments to allow for special tax assessments for infrastructure projects. The House is expected to have a floor vote next week.


Regulatory Reform

Comprehensive Regulatory Reform
An omnibus regulatory reform bill was unveiled Thursday in the Senate Commerce Committee. HB169: Regulatory Reduction Act of 2016 contains several changes to state regulations, including:

  • Rule Making: Prohibits any agency from adopting rules with fiscal impact greater than $100 million of a fiscal year or $10 million within a five-year period. For rules within a board or commission, the rule must be approved by at least 60% of voting members. Agencies are prohibited from adopting codes, standards, or regulations adopted by the federal government unless the agency provides a procedure to review and approve the change within 30 days.
  • Building Code Council & Energy Efficiency Standards: Exempts requirements of the Energy Conservations Code from the Building Code classifications. Directs the Department of Environmental Quality to develop a comprehensive program to manage energy, water, and other utility use for agencies and higher learning institutions.
  • Environmental Review Commission: Eliminates required reports from the Mining Act, sustainable energy efficiency building program, vehicle emissions, NC Beach & Inlet Program, etc.
  • Distilleries: Permits distillery permit holders to sell spirituous liquor in closed containers at wholesale or retail, for delivery across state lines. Expands on site sales to allow customers to purchase one bottle of each product produced at the distillery.
  • Education & Testing: Eliminates education testing statute that encourages local administrative units to develop local testing programs for students diagnose needs.
  • Recycling: Repeals ban of electronic disposal by permits. 
  • Coastal Area Management Act: Repeals requirement of coastal counties to develop land-use plans.
  • Turtle Sales: Permits the sale of turtles, of which is currently prohibited aside for purposes other than scientific, educational, or food purposes.
  • Terminal Groins: Changes reporting to the Coastal Resources Commission from annually to every 5 years.

Coal Ash Commission
The House introduced a new proposal last week that would put back in place the Coal Ash Management Commission, of which is charged with establishing the regulations of cleaning up coal ash. The measure, SB 71: Comm’n Appointment Modifications reinstates the commission, giving the Governor the power to appoint the majority of the members. In addition, the bill reconstitutes the Mining Commission and the Oil and Gas Commission, leaving in place the shale oil gas regulations adopted by the commission. The previous legal issues revolved around what branch of government has control over the issues of cleaning up coal ash, legislative vs. executive. The bill provides that if the issue goes back to court and the Governor does not appoint members the responsibility for coal ash regulations transfers to the Environmental Management Commission. The Senate voted unanimously on Thursday to not concur to the bill, setting up a potential conference committee between the House and Senate to work out the differences within the new bill. The Governor has stated that he will veto the measure if passed by the General Assembly.



Access to Affordable College Ed. Act

SB 873: Access to Affordable College Ed. Act, sponsored by Sen. Tom Apodaca (R-Buncombe), received two committee hearings last week- first in the Senate Education/Higher Education committee, followed by the Senate Appropriations/Base Budget committee. SB 873 aims make the state’s public universities more affordable by making the following changes:

  • Establishes a fixed tuition and fees payment program that would be available to freshmen or undergraduate transfer students, which would require that the program guarantee the cost of both tuition and fees remain the same or lower than when the student enters the program. The fixed tuition and fees period would depend on the level of degree sought or the transfer status.
  • Requires the UNC Board of Governors and the Board of Trustees at each constituent institution to reduce student fees, beginning with the 2018 fall semester.
  • Mandates the UNC Board of Governors to set the tuition rates for the following universities at $500 per semester for in-state students and $2,500 per semester for out-of-state students: Elizabeth City State University, Fayetteville State University, UNC Pembroke, Western Carolina University, and Winston-Salem State University.
  • Establishes the Cheatham-White Scholarships, a merit scholarship program at NC Agricultural & Technical State University and at NC Central University. The scholarship would fully fund four years and four summers at the two universities, with each university able to award up to 50 scholarships each.

The bill now awaits its next hearing in the Senate Rules committee.

Achievement School District

A bill that would allow private charter school companies to take over some of the state’s lowest performing public schools passed the House Education committee on Wednesday evening. HB 1080: Achievement School District is sponsored by a bi-partisan group of three legislators- Reps. Rob Bryan (R-Mecklenburg), Cecil Brockman (D-Guilford), and John Bradford (R-Mecklenburg). Under the legislation, the State Board of Education will select five low-performing schools to be put into an “achievement school district,” (ASD) which would have its own superintendent, and entities would be in charge of improving student performance within five years.

Additionally, the bill proposes two other pilot programs for low-performing schools that are chosen for this turnaround model. If a local school board does not allow a low-performing school within the district to be part of the ASD, then the local school board must either close the school or allow for a “turnaround principal” to take over the school. The turnaround principal would receive a five-year contract to improve student performance within the school. Last, the “innovation zone” pilot program would allow local school boards to lump three low-performing schools into one of these zones. Under an innovation zone, the schools are given more freedom from state regulations, similar to charter schools in North Carolina.

HB 1080, which passed the committee on a bi-partisan vote of 18-11, now goes to the House floor for debate on Wednesday, June 1.

Student Online Protection Act

Last week, the Senate introduced, and subsequently unanimously passed, a new version of HB 632: Student Online Protection Act. When the bill passed the House last year, the bill’s purpose was to study student online privacy during the interim. The new version of the bill, proposed by Sen. Chad Barefoot (R-Wake), prohibits operators of third-party online educational applications for K-12 students from using personally identifiable information for any purpose other than the administration of school activities. On Thursday, Sen. Barefoot offered an amendment which would allow a parent, school, teacher, local board of education or the State Board of Education to report a violation to the Attorney General. If the operator of the website is in violation of state law, the Attorney General would be permitted to bring civil action to seek injunctive or equitable relief. The House will now vote whether or not to concur with the Senate’s changes to the bill.

Teacher Pay

Last week, Senate Republicans announced their proposal to increase the average annual salary of a teacher to almost $55,000 over the next two years. After announcing the increase in average salary, Sen. Phil Berger (R-Rockingham) stated that if everything else remains stagnant, teachers will receive approximately $200,000 in additional pay over the course of their career if their plan became law. This announcement comes ahead of the Senate debating the budget next week. Sen. Berger stated that additional details of how the pay increases will be funded, as well as raises for all other state employees, will be announced next week when the rest of the budget is released.

Read Sen. Berger’s press release on the teacher pay plan.



DOT Changes
The House Transportation Committee last week approved HB 959: DOT Proposed Legislative Changes, which focuses on making the Department of Transportation (DOT) more “customer-friendly.” Among the numerous regulatory changes, the bill permits the N.C. Turnpike Authority to submit customer tolling bills electronically; permits DOT to avoid local government consultation for infrastructure projects costing $250,000 or less vs. the current law of $150,000 or less; allows the DMV to place a joint tenancy with right of survivorship option on vehicle title applications; and allows DOT the right of way for non-utility owned communications and data cable placements. The bill now goes to the full House for consideration.

Motorcycle/Cyclists & Discrimination       
This week two House committees approved HB 1050: DOT/No Discrimination Against Motorcyclists, which prohibits the DOT in implementing regulations that could “discriminate” against motorcycles and cyclists. The proposal directs the DOT to not formulate any transportation policies, funds, and planning, designing, constructing and maintaining transportation facilities that would “discriminate” against motorcyclists. The bill comes as advocacy groups for the industry argue that certain parking garages have banned cyclists because of sensor issues, etc. The bill is expected to be heard by the full House this week



NC/SC Original Boundary Confirmation

On Thursday afternoon, the Senate unanimously passed SB 575: NC/SC Original Boundary Confirmation, sponsored by Sen. Tommy Tucker (R-Union). The bill is a result of a border surveying process that was established in 1995 when the Joint Boundary Commission was created in order to ensure the border between the two Carolinas was the same as when it was originally established in the 1700s. According to Sen. Tucker, the process became difficult over time due to landmarks that were used to establish the border, such as fence posts and rocks, no longer existing.

SB 575 aims to ease the transition for the residents that will have to switch states. If both North Carolina and South Carolina approve the legislation, then on January 1, 2017, three homes that are currently in NC, will then be in SC, while 16 SC homes would wake up in NC on that date. Additionally, if the bill is approved, then 54 homes and businesses will have the new state line running through their properties. Those property owners will be allowed to choose in which state they live. In order to ease the transition, residents that are forced to switch states will be allowed to continue sending their children to their current public schools, and will be eligible for in-state tuition in their previous state for the next 10 years. Additionally, those homeowners will be permitted to continue using their current utility companies. All residents that find their properties in a new state next year, however, will have to pay taxes to that state and get a new driver’s license.

The bill now goes to the House for their consideration.


Posted by: Kerri A. Burke, McGuireWoods Consulting LLC @ 12:00:00 am  Comments (0)
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